Effects of Ownership Structure on Firm Performance : Evidence from Iran

This study investigates the relationship between ownership structure and corporate performance of top 50 companies listed on the Tehran Stock Exchange during the period 2001-03. In the present study, the ownership structure is considered in terms of institutional and non-institutional ownership. The study uses Returns on Asset (ROA), Return on Equity (ROE), and Tobin's Q ratios as measures of firm performance. The results indicate that there is a positive relationship between institutional ownership and firm performance in the case of Iran. In addition, it is found that ownership structure is highly concentrated and firms with diffused ownership have performed better than those with concentrated ownership. In addition, there is a significant negative relationship between performance and company size, and finally the relationship between debt-to-asset ratio and performance is significant.